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Fed Says It Will Begin Buying Corporate-Debt ETFs on Tuesday

  • U.S. central bank launches long-awaited backstop for companies
  • Fed outlines strategy including three phases for ETF purchases
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WATCH: The Fed said a facility designed to purchase eligible corporate debt from investors will launch today.(Source: Bloomberg)
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The Federal Reserve said a facility designed to purchase eligible corporate debt from investors will launch on May 12, bringing a key part of the U.S. central bank’s emergency coronavirus lending program online following weeks of anticipation.

The so-called Secondary Market Corporate Credit Facility will begin purchases of eligible exchange-traded funds invested in corporate debt on Tuesday, the New York Fed said Monday on its website. It was first announced in March and has played an important role in keeping financial markets relatively calm since then.